Turning Point Brands (NYSE:TPB) versus RLX Technology (NYSE:RLX) Financial Review

RLX Technology (NYSE:RLX) and Turning Point Brands (NYSE:TPB) are both consumer staples companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, dividends, risk, valuation and profitability.

Earnings and Valuation

This table compares RLX Technology and Turning Point Brands”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RLX Technology	$566.11 million	5.32	$131.83 million	$0.10	19.45
Turning Point Brands	$463.06 million	3.49	$58.17 million	$2.33	35.77

RLX Technology has higher revenue and earnings than Turning Point Brands. RLX Technology is trading at a lower price-to-earnings ratio than Turning Point Brands, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares RLX Technology and Turning Point Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RLX Technology	20.76%	6.15%	5.60%
Turning Point Brands	8.78%	11.98%	5.87%

Analyst Recommendations

This is a summary of recent recommendations and price targets for RLX Technology and Turning Point Brands, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RLX Technology	0	2	0	0	2.00
Turning Point Brands	1	1	3	1	2.67

RLX Technology currently has a consensus price target of $2.50, suggesting a potential upside of 28.53%. Turning Point Brands has a consensus price target of $113.50, suggesting a potential upside of 36.17%. Given Turning Point Brands’ stronger consensus rating and higher probable upside, analysts plainly believe Turning Point Brands is more favorable than RLX Technology.

Institutional and Insider Ownership

22.7% of RLX Technology shares are held by institutional investors. Comparatively, 96.1% of Turning Point Brands shares are held by institutional investors. 53.4% of RLX Technology shares are held by company insiders. Comparatively, 5.4% of Turning Point Brands shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Dividends

RLX Technology pays an annual dividend of $0.10 per share and has a dividend yield of 5.1%. Turning Point Brands pays an annual dividend of $0.32 per share and has a dividend yield of 0.4%. RLX Technology pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Turning Point Brands pays out 13.7% of its earnings in the form of a dividend. Turning Point Brands has raised its dividend for 7 consecutive years.

Volatility and Risk

RLX Technology has a beta of 1.2, meaning that its share price is 20% more volatile than the S&P 500. Comparatively, Turning Point Brands has a beta of 0.91, meaning that its share price is 9% less volatile than the S&P 500.

Summary

Turning Point Brands beats RLX Technology on 11 of the 18 factors compared between the two stocks.

About RLX Technology

RLX Technology Inc., together with its subsidiaries, engages in the manufacture and sale of e-vapor products in the People's Republic of China and internationally. It serves partner distributors and retail outlets. The company was founded in 2018 and is headquartered in Beijing, China.

About Turning Point Brands

Turning Point Brands, Inc., together with its subsidiaries, manufactures, markets, and distributes branded consumer products. The company operates through three segments: Zig-Zag Products, Stoker’s Products, and Creative Distribution Solutions. Zig-Zag Products segment markets and distributes rolling papers, tubes, finished cigars, make-your-own cigar wraps, and related products, as well as lighters and other accessories under the Zig-Zag brand. The Stoker’s Products segment manufactures and markets moist snuff tobacco and loose-leaf chewing tobacco products under the Stoker’s, Beech-Nut, Durango, Trophy, and Wind River brands. Its Creative Distribution Solutions segment market and distribute other products without tobacco and/or nicotine to individual consumers through VaporFi B2C online platform, as well as non-traditional retail through VaporBeast. In addition, it markets and distributes cannabis accessories and tobacco products. The company sells its products to wholesale distributors and retail merchants in the independent and chain convenience stores, tobacco outlets, food stores, mass merchandising, drug store, and non-traditional retail channels. The company was formerly known as North Atlantic Holding Company, Inc. and changed its name to Turning Point Brands, Inc. in November 2015. Turning Point Brands, Inc. was founded in 1988 and is headquartered in Louisville, Kentucky.